Capital Gains Tax Cuts, Investment, and Growth

Steven Mark Fazzari () and Benjamin Herzon
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Benjamin Herzon: The Jerome Levy Economics Institute

Macroeconomics from EconWPA

Abstract: Congress currently is considering changes in the capital gains tax, including reducing the rate, indexing the rate to inflation, or some combination of reduction and indexing. These changes have been advocated on the grounds that a cut in the rate will stimulate investment and economic growth. In this working paper, Research Associate Steven M. Fazzari and Benjamin Herzon, a doctoral candidate at Washington University, present a theoretical analysis of the effect of a tax cut on the cost of capital, investment, and output.

JEL-codes: E (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-pbe and nep-pub
Date: Written 1998-11-19
Note: Type of Document - Acrobat PDF; prepared on IBM PC; to print on PostScript; pages: 41; figures: included
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http://129.3.20.41/eps/mac/papers/9811/9811006.pdf (application/pdf)

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